Quick mention: Our next SVC event will be in San Francisco on February 8, so mark your calendars, babies! (We were shooting for December 1, but we couldn’t make the timing work. We do hope to see some of you the following week, at London Disrupt.) Details to come. If you’d like to get involved as a sponsor, let us know; we’d love to talk.
See you Monday, everyone.:)
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Top News in the A.M.
Apple, why do you hate us?
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Accel Cofounder Jim Swartz: It Hasn’t Burst, But It’s a Bubble All Right
Earlier this week, the Swartz Center for Entrepreneurship, a “hub for entrepreneurship” in the center of Carnegie Mellon University’s Pittsburgh campus, was officially launched in an event attended by upwards of 600 students, alums, and professors. They’ll have even more to celebrate when construction on the 300,000 square-foot business school where it’s being housed is completed in 2018.
At the center of all: Jim Swartz, who cofounded the storied venture firm Accel Partners in 1983 and who last year donated $31 million to CMU, where Swartz nabbed his master’s degree in 1966. The native Pennsylvanian says the gift is designed to help Pittsburgh cement its new role as a thriving tech center. (Google, Microsoft, and Uber are among a growing number of companies with local campuses.)
We talked with Swartz earlier today about the donation, as well as whether he remains active on the venture scene, and, if so, what he makes of the current state of things. Our chat has been edited for length.
TC: You founded Accel with Arthur Patterson in 1983. When did you step back from the firm, and do you still invest in startups?
JS: It’s been a continuous process and I’m still involved to a significant degree. Arthur and I ran the firm, then we brought in Jim Breyer, and the three of us ran it, then he ran it, then we created an operations committee that ran it, and now there’s a fourth generation. But we’re still involved, [mentoring the VCs there], helping wherever we can with new projects, or selling our ways into things. We’re not under the gun anymore, though, which is a good feeling.
TC: How active an angel investor are you?
JS: I’m not San Francisco bubble crazy, but I’m reasonably active, funding two or three companies a year, something like that. I still look for really good technology and great people.
TC: What do you make of the current environment?
JS: It won’t end well. I’ve been at this since 1970 and Arthur and I have seen five or six cycles at this point. This one is prolonged for sure. In truth, I thought [the last bubble] was over in 1997 and let it run and thank goodness because we made a ton of money. I think the difference here is Sarbanes-Oxley, which has made it incredibly different and unsavory to take companies public. The regulatory environment is too difficult. Before, if you had $50 million in revenue and could show a profit, you could go public; today that number is what, $200 million, $300 million?
New funds are filling the funding gap. Accel Growth is one of them, and lot of other firms have taken advantage of things, too. But it creates questions about whether [founders] ever want to go public and how investors will get out.
TC: Do you see an actual “crash”? It’s hard to see how that happens, with new capital continuing to come in.
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New Fundings
Ather Energy, a three-year-old, Bangalore-based company that sells premium electric scooters, is raising $31 million in new funding from Hero MotoCorp, the world’s largest seller of motorcycles and scooters. Hero will own as much as 30 percent of the startup. Tech in Asia has more here.
Conekta, a five-year-old, Mexico City-based payments processing company, has raised $6.6 million in Series A funding from VARIV Capital, FEMSA Comercio, Jaguar Ventures, and Conconi Growth Partners. Forbes Mexico has more here (in Spanish).
CubeWorks, a three-year-old, Ann Harbor, Mi.-based millimeter-scale computing company (its tech aims to enhance existing devices like wearables with its new energy harvesting methods), has raised an undisclosed amount of funding from Intel Capital. More here.
KNL Networks, a five-year-old, Oulu, Finland-based wireless communications startup that provides IP communications to isolated and inaccessible areas, has raised $10 million in Series A funding led by Creandum, with participation from Inventure, Butterfly Ventures, and angel investors. Tech.eu has more here.
Libryo, a year-old, London-based legal tech startup, has raised an undisclosed amount of seed funding from Nextlaw Labs, Seedcamp, and an unnamed seed-stage fund. More here.
MPower Financing, a 1.5-year-old, Washington, D.C.-based peer-to-peer lending platform for student loans (it connects students to loans from investors without the need for a co-signer), has raised $6 million in Series A funding led by Zephyr Peacock, with participation from 1776 Ventures, Goal Structured Solutions, VilCap Investments, DreamIt Ventures, Fresco Capital, and University Ventures. Zephyr will help the company set up a location in Bangalore. The Tech Portal has more here.
Orvibo, a four-year-old, Shenzhen, China-based maker of smart light switches, smart electrical plugs and smart fire alarms, has raised $16 million in Series B funding led by Shenzhen Topband, itself a manufacturer of a wide range of electronic products. Earlier backer SAIF Partners and others also joined the round. China Money Network has more here.
Retention Science, a five-year-old, Santa Monica, Ca.-based AI-driven retention marketing startup, has raised $750,000 in seed funding led by Forerunner Ventures. The company reportedly raised $1.3 million in seed funding led by Baroda Ventures back in 2012. Best Techie has more here.
Unity Biotechnology, a year-old, San Francisco-based company that’s targeting diseases related to aging and focusing its early work on halting the progression of atherosclerotic disease, has raised $116 million in funding. Arch Venture Partners, Baillie Gifford, Fidelity Management and Research Company, Partner Fund Management, Venrock, and Bezos Expeditions participated, along with earlier backers WuXi PharmaTech and Mayo Clinic Ventures. FierceBiotech has more here.
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New Funds
MIT President Rafael Reif announced Wednesday night that the Institute will launch The Engine, a new accelerator program with a planned $150 million venture fund to support startups innovating in the science and technology spaces (and hopefully address Boston’s retention problem). BostInno has more here.
System.One, a new, Berlin-based pre-seed venture capital fund with a global mindset and a single GP — Maximilian Claussen, who has formerly worked at Earlybird Ventures, Goldman Sachs and elsewhere — has launched with €8.2 million (roughly $9 million) in commitments. More here.
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IPOs
China’s ZTO Express, the company that provides shipping and delivery services to Alibaba among others, saw its shares trade downward on its first day of trading yesterday on the NYSE. More here.
Myovant Sciences, a Brisbane, Ca.-based drug company focused on women’s health diseases, raised $218 million in its IPO, making it the largest biotechnology IPO this year to date. Its shares hit the trading floor this morning (you can catch the action here). MedCity News has more here.
Quantenna Communications, a Fremont, Ca.-based provider of Wi-Fi video networking for whole-home entertainment, has raised $107 million by offering 6.7 million shares at $16 per share, the top end of its range. You can see how the shares are trading here.
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Exits
Earlier this year, Alibaba acquired a controlling stake in Lazada, the Rocket Internet-backed e-commerce company in Southeast Asia, for $1 billion. Now it’s taking steps to turn the business into the “emerging market Amazon,” says TechCrunch, which reports that Lazada is in advanced talks to acquire Redmart, a Singapore-based grocery delivery service. Much more here.
PowWow Mobile, a four-year-old, San Francisco-based app mobility company, is spending an undisclosed amount to acquire its 4.5-year-old, Atlanta-based competitor StarMobile. StarMobile had raised more than $6 million from investors, shows Crunchbase. PowWow has meanwhile raised $8.3 million from its backers. SearchMobile Computing has more here.
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People
Carmen Chang, a partner at New Enterprise Associates, has a new title: Chairman and Head, Asia. The firm also promoted two investors to general partner: Mohamad Makhzoumi, head of the firm’s healthcare services/IT investing practice; and Chetan Puttagunta, a tech investor focused on enterprise software. More here.
Ryan Collins, the hacker who stole nude photos of female celebrities in 2014, has been sentenced to 18 months in federal prison, officials announced yesterday.
Renowned iPhone hacker-turned-entrepreneur George Hotz has cancelled his autonomous driving startup’s first official product, an aftermarket add-on that would’ve allowed certain cars to gain Autopilot-like highway driving assistance abilities. He says it wasn’t worth providing detailed answers to 15 questions from the National Highway and Traffic Safety Administration about the technology.
Vinod Khosla sat down with Bloomberg’s Emily Chang this morning to talk investing strategy, and how he feels about clean tech investing today.
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Jobs
Verizon is looking for a strategy and corporate development manager. The job is in Palo Alto, Ca.
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Essential Reads
Meal replacement powder maker Soylent has now halted sales of its main product as part of an investigation into why some customers have been getting sick after eating its products. Soylent has raised roughly $22 million from investors. More here.
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Detours
Stand-up comedian Bobby Lee versus hot wings.
Millennials aren’t cheap; they’re thrifty.
I’m not an assh_le. I’m an introvert.
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Retail Therapy
A beautifully designed toaster (really!).